WILSHIRE PALiSADES LAW GROUP, P+C, David L Lefkowitz (SBN 127457) Stephen I)-Holz (SRN 83647) 1.337 Ocean Avenue, Suite .A. Santa Monica, CA 90401 1009 Telephone: (310) 3934929 Facsimik: (310) 393-5438 Emai': 121w groupcom Attorneys ibr I1I Piai.:ntifts UNITED STATES DISTRICT COURT CENrfRA.L DISTRICT OF CALIFORNIA Lt . r r. -o -x w Case 2:11-cv-10284-JFW-PJW Document 22 Filed 04/09/12 Page 1 of 36 Page ID #:552 DOUGLAS B. NUROCK; 1-'RAN( ESCA STONE, MiCHAEL K M0E2ZL individually and as Trustee of the MICHAEL K. MOEZZI FAMILY TRUST Ui 4/16/2003; NAZANIN M01ZZ1, JOSEPH DAI11 }-JE1MER GREGORY GEISS, 'R(JTHANF DAIII [-JEEMER, individually and. on behalf of all others simihu-iysituated, Plaintiffs. vs PELICAN EYES HOLDING COMPANY .LI..C. a California limited liabitity conpany PELICAN RESCUE, LL', California Lim:it.ed i.iabihty corn [) iiany; AMINIS IRADORA DL HO 1 fELE, DL SAN JUAN DEL StIR, S A INVE RSIONES INMORI1 JARA DE SAN JUAN DEL SUR SOCIEDAJ3 ANONIMA, INVERSIONES TOGO DA SOC1FD ANONIMA, JAMES K HANKI A, n idivdu, MiCHAEL J. .EML1N(J, an individual; and DOES 1-10, Defendants, Case No. CV 11-10284-OW (PJVx) FIRST AMENDED COMPLAINT FOR: Violation of §10(b) of the Securities Exchange Act of 1934 and Rule 10b5 Violation of Section 20(a) of the Securities and Exchange Act of 1934 Violation of §12a)(2) of the Securities Act of 1933 Violation of §25401. of the California Corporations Code Violation of §25041. of the Corporations Code Deceit (Intentional Mis representation) Deceif (Concealment of Fiduciary Duty Constructive Fraud Breach of Contract Inducing Breach of Contract lntentogal Interference With Prospective Economic Advantage Breach of Contract (lass Action Demand for Jury Trial 3 4 4 6 7 8 C) 1(1) 11 12 13 14 .15 16 17 18 19 20 21 22 23 24 25 26 27 L 2. 3. 4. 5. 6. 74 8. 94 10. 1i .12. 1.3. ci FIRST A1ujj) COMPLAINT II . :.z ..
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WILSHIRE PALiSADES LAW GROUP, P+C, David L Lefkowitz (SBN 127457) Stephen I)-Holz (SRN 83647) 1.337 Ocean Avenue, Suite .A. Santa Monica, CA 90401 1009 Telephone: (310) 3934929 Facsimik: (310) 393-5438 Emai': 121w groupcom Attorneys ibr I1I Piai.:ntifts
UNITED STATES DISTRICT COURT
CENrfRA.L DISTRICT OF CALIFORNIA
Lt .
r r.
-o -x w
Case 2:11-cv-10284-JFW-PJW Document 22 Filed 04/09/12 Page 1 of 36 Page ID #:552
DOUGLAS B. NUROCK; 1-'RAN( ESCA STONE, MiCHAEL K M0E2ZL individually and as Trustee of the MICHAEL K. MOEZZI FAMILY TRUST Ui 4/16/2003; NAZANIN M01ZZ1, JOSEPH DAI11 }-JE1MER GREGORY GEISS,
'R(JTHANF DAIII [-JEEMER, individually and. on behalf of all others simihu-iysituated,
Plaintiffs.
vs
PELICAN EYES HOLDING COMPANY .LI..C. a California limited liabitity conpany PELICAN RESCUE, LL', California Lim:it.ed i.iabihty corn
[) iiany;
AMINIS IRADORA DL HO 1fELE, DL SAN JUAN DEL StIR, S A INVE RSIONES INMORI1 JARA DE SAN JUAN DEL SUR SOCIEDAJ3 ANONIMA, INVERSIONES TOGO
DA SOC1FD ANONIMA, JAMES K HANKI A, n idivdu, MiCHAEL J. .EML1N(J, an individual; and DOES 1-10,
Defendants,
Case No. CV 11-10284-OW (PJVx)
FIRST AMENDED COMPLAINT FOR:
Violation of §10(b) of the Securities Exchange Act of 1934 and Rule 10b5 Violation of Section 20(a) of the Securities and Exchange Act of 1934 Violation of §12a)(2) of the Securities Act of 1933 Violation of §25401. of the California Corporations Code Violation of §25041. of the Corporations Code Deceit (Intentional Mis representation) Deceif (Concealment
of Fiduciary Duty Constructive Fraud Breach of Contract Inducing Breach of Contract lntentogal Interference With Prospective Economic Advantage Breach of Contract
(lass Action
Demand for Jury Trial
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4
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8 C)
1(1)
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FIRST A1ujj) COMPLAINT
II . :.z ..
Case 2:11-cv-10284-JFW-PJW Document 22 Filed 04/09/12 Page 2 of 36 Page ID #:553
1
Plaintiffs allege:
2
3
1. This action arises under 18 U.S.C. §§ 1961, 1962 and 1964. This Court
4 has original jurkdiction pursuant to 28 U.S.C. §§ 1331 and 1337.
5
2. This Court has supplemental jurisdiction over Plaintiffs' state law claims
6 It under 28 U.S.C. § 1367(a).
7
3. Venue is proper in this Court under 18 U.S.C. § 1965 and 28 U.S.C. §
8 1391 because at least one defendant resides, is found, has an agent, or transacts his
9 affairs in the Central District of California, Further, a substantial part of the events
10 or omissions giving rise to the claims pleaded in this Complaint occurred in the
11 Central District of California and at least one defendant may be found in this District.
12
13
Plaintiffs
14
4. Plaintiffs Douglas B. Nurock and Francesca Stone both live in South
15 Lake Tahoe, California. In October 2005, the Nurock Plaintiffs purchased a residence
16 for $269,000 from Pelican Eyes Piedras y Olas Sociedad Anonima ("PEPO"). The
17 residence was called Casa Fantasia, and it is located in Phase 2 of the Pelican Eyes
18 Resort ("Resort").
19
5. Plaintiffs Michael K. Moezzi. individually and as Trustee of the Michael
20 Moezzi Family Trust IJA 4/16/2003. and Nazanin Moezzi both Jive in Gainesville,
21 Florida. Inearl\ 2006, the \loczii Plaintftk purehased aresidcnce hr 379,000 horn 22 PEPO. The rcidctice wa called Caa Florida. and it is also located in Phase 2 of the
PcI iLtfl L 5 Rcort (Reuit),
ft Plainftk .Iucplt Dahilicittier. (ilccuI\ (ci. and Ruthanc Dahlhciiucr
the 1)ahlheitncr PaintitkH li\e in ;\ti Nia. (ieoraia . :\ c\\urth. (ico1'id. and
20
Seneca. Suntli (arulina. tcpccti\cI\ In ()ct( hci H()(, the l)ahhhtcirncr Plaiiiiifk
ttcftHc(l It i idcncc 1" )1 42.0() hunt PLP). I he teidetiee \\H eahed (aa
H
2
Case 2:11 -cv- 10284-JFW-PJW Document 22 Filed 04/09/12 Page 3 of 36 Page ID #:554
1 Verde, and it is also located in Phase 2 of the Pelican Eyes Resort ("Resort").
Defendants ants
7. Defendant Pelican Eyes Holding Company, LLC ("PEW") k a
California limited iiahiii company that has its headquarters in Long Beach.
California. PEHC controls the Resort.
8. Defendant Pelican Rescue, LLC ("PRG") is a California limited liability
company that has its headquarters in Long Beach, California. PRG is the Managing
member of PEHC, and owns approximately 40% of PEHC. PRG and PEHC are
hereinafter collectively referred to as the "Pelican Eyes Companies."
9. Defendant Administradora de Hoteles de San Juan del Sur, S.A.
("ADH") is a company formed under the laws of Nicaragua.
10. Defendant Inversiones Inmobiliara de San Juan del Sur Sociedad
Anonima ("ITS") is a company formed under the laws of Nicaragua.
11. Defendant Inversiones Togo Sociedad Anonima ("Togo") is a company
formed under the laws of Nicaragua.
12. PEHC, the California limited liability company, owns all but one share
of ADH, all but one share of ITS and all but one share of Togo. PEHC thus controls
all three of those entities.
13. Defendant James K. HanLia ("Hankla") is the President and one of the
managing memher of PEHC. Hankla is also one of the mana$in$ members of PRG.
14, Defendant Michael J. Emi in ('Emliiig") k an aeti \ e member of the
State Bar of Ca] ii niia. Fining is a !nana$inc member of PEHC and is ako a
mnammmn member t' PRG.
l. The cpemation that ic the ubjcct nf tbic Complaint !I1\h\e ilan\
participant. but it a cntrH led by 1-lankla. \ Ph the uHtaiitial aid P a cadre 01
!I1!LIC! iiicludiiic. iiiiii )t!iei. Liii] nc ic'h]ectl\cl\. the - III , Idcr
10 , f) I .I I nt I ft are H11,1\\ are of time true namc and capac it ie P tic !)cfdiidaiit
\
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2 0
Case 2:11-cv-10284-JFW-PJW Document 22 Filed 04/09/12 Page 4 of 36 Page ID #:555
1 named herein as DOES 1 through 10, inclusive, Plaintiffs are informed and believe
2 md, upon that basis, alleec that each of the Defendants designated as DOES 1
3 through 10 is responsible in some manner for the acts, transactions and occurrences
4 rcL'rred to in this Complaint, and that the daiimcs alleced b Plaintiffs in this
5 Complaint were directly and proximately caused by said Defendants conduct,
6 Plaintiffs will a k leave of Court to amend this Compla iii. to show the true names and
7 capacities of the Defendants designated as DOES I through 10 in this Complaint
8 when they have been ascertained.
9
Ii i [Si113 I i III RI &'d
10
17. Plaintiffs are informed and believe and, upon that basis, allege that at all
11 relevant times, each of the Defendants was an agent, ser ant, or employee of one or
12 more of the remaining Defendants, was at all times herein mentioned acting within
13 the course and scope of such actual, apparent or ostensible agency or employment and
14 was acting with the permission, knowledge, consent and/or ratification of the other
15 Defendants.
16
18. Plaintiffs are informed and believe and, upon that basis, allege that at all
17 relevant times, each of the Defendants herein knew of the breaches of duties owed to
18 Plaintiffs that are described in this Complaint, and gave the other Defendants herein,
19 and each of them, substantial assistance or encouragement to engage in the conduct
20 constituting such breaches of duty. Alternatively, Plaintiffs are informed and believe
21 and, upon that fttis. a! lee that at all rele\ ant times, each of the Defendants herein
cave 1111 hstant a I ass i taiice t the other Dc lendants here iii in \ iolat Inc I he dttt ie they
ed i Plaint 1k, and in doll -I, ak io!ated their u a dat ie to , Plainti 1k.
9,
1e1e\ ant tiiue. each of the Delet huits herein \\as a\\are that each I the thiei
() DeteiidanK. inc!ndinc the DOE DelendanN. planned to eticace iii the mnctn!
coiidtict 111 herein wid that each 1ihie f )c 1 '~
I Ildtilt, herein acieed ith the
Case 2:11-cv-10284-JFW-PJW Document 22 Filed 04/09/12 Page 5 of 36 Page ID #:556
1 Defendants. to engage in that conduct and intended that the wrongful conduct alleged
2 Ii herein occur.
3
4
20. Plaintiffs seek to recover the dainaes they sustained as a result of a
5 fraudulent scheme the Defendants conducted. As a result that scheme, Plaintiffs lost
6 real estate worth millions of dollars, all of which wound up in the hands of Defendaiit
7 PEHC. Moreover, in the course of the scheme, Plaintiffs were solicited to (and did)
8 invest in securities offerings by PEHC that sought to raise funds to "rescue" the
9 Resort from its financial problems.
10
21. More specifically, PEPO sold a residence called Casa Fantasia to the
11 Nurock Plaintiffs in approximately October 2005. The residence was located in the
12 Resort. A Purchase and Sale Agreement binding under the law of Nicaragua was
13 executed, but that Agreement was never recorded, nor was a deed issued to the
14 Nurock Plaintiffs. Instead, title to the property remained in the hands of PEPO.
15 However, the Nurock Plaintiffs were repeatedly assured that a deed would be shortly
16 forthcoming and would be issued when the process of registering the Resort as a
17 condominium development under Nicaraguan law was completed. The Nurock
18 Plaintiffs took possession of Casa Fantasia and used and enjoyed the residence for
19 several years after they purchased it.
20
22. PEPO sold the Moezzi Plaintiffs a reJdence called Casa Florida iii early
21 2006. The residence a located in the Resort. A Ptirchase mid Sale ;\ereeiiieiit
22 biiidin under the la\\ of \icaraeua was e\ecuted. hut that ; ereeluent \v5 iie ci
recorded, nor \\a , a deed kued to the \loezzi Plaintilk. lniead. title to the propert\
iemained iii the hands of PEPO, I Io e ci. the \ loeiii Plaint ilk crc repeated!\
Niied that a deed \ mid he hioi1l\ ioiihcwiiine and onid He kued Micil the
6 pioce iekierine the Reoit a a cndoiiiininni de\ehpinent wider Nicaianaii
Ta\k \\ completed. hue N1()c//1 Phaintilk turk eioa ci Cai FHiida in late
Case 2:11 -cv- 10284-JFW-PJW Document 22 Filed 04/09/12 Page 6 of 36 Page ID #:557
1 2007 and used and enjoyed the residence for several years after they purchased it,
2
23. PEPO sold the Dahllieimer Plaintiffs a residence called Casa Verde in
3 October 2006. The residence was located in the Resort. A Purchase and Sale
4 :\reenieiit bindin under the law of Nicaragua va executed in 2007 for the
5 townhouse, but that Agreement ws never recorded, nor Was a deed issued to the
6 Dahlheimer Plaintiffs, I iiL,, tead, title to the property remained in the hands of PEPO.
7 However, the Dahiheimer Plaintiffs were repeatedly assured that a deed would be
8 shortly forthcoming and would be ksucd when the process of registering the Resort
9 as a condominium development under Nicaraguan law was completed. The
10 Dahiheimer Plaintiffs took possession of Casa Verde in 2008 and used and enjoyed
ii the residence for several years LI!'ter they purchased it.
12
24. The Resort experienced increasing financial difficulties, and PRG' s
13 Hankla and Emling were contacted by the Resort's founder Robert Alan "Chris"
14 Berry ("Chris Berry") to seek their assistance in resolving the Resort's financial
15 problems. Hankla and Emling became involved with the Resort in approximately July
16 2009, and about a month later, they and others formed PRG.
17
23. The Defendants became aware of the fact that deeds to the residences
18 that had been purchased by Plaintiffs had not been recorded or registered, and
19 concocted a scheme to obtain the real estate owned by Plaintiffs and others. The heart
20 of the scheme was to make a securities offering to potential investors, including I
Plainti fts. which: (i) ackiio Ieded that Plaintifk O\\ ned the ft F( )perties, and (ii) 21 rea'oji'ed them that PRG and PEFIC intended to operate the Resort and take the
necear\ \tep to oHain and eoii cv marketable title to Plaintilk' ieideiiee to them
mnce the\ had allead\ paid tot it In aetnalit\. I)elendaiiN. liile tlle\ \\ cue
olicit III c and ellinc the ecnri1ie \\ Ph ihee lake mcpreentatioii. ecle1l\ otu
Plaint ilk and the cla planned and conpiied to and jmceeded to CHain wneHiip
and cnttmol lall oLdie meal estate in the Reuii. imiclnditto Plaintjlk eidciice and
Case 2:11-cv-10284-JFW-PJW Document 22 Filed 04/09/12 Page 7 of 36 Page ID #:558
1 II those of other similarly situated persons. Defendants did not intend to, and never did,
2 11 convey deeds to any of the residences to the P1aiiitiftcla.
3
26. The scheme the Defendants perpetrated to achieve their objective w as
4 to claim to have a promissory note ("Note") that nobody has ever seen for a $193,000
5 debt supposedly owed by PEPO to a corp.nation the Defendants had caused to be
6 formed after they started to "rescue" the Resort. When PEPO defaulted on the
7 supposed Note, Defendants instigated a lawsuit in Nicaragua against PEPO. In the
8 lawsuit, one attorney represented the plaintiff corporation recently formed by the
9 Defendants (the "Plaintiff Corporation"), and another attorney from the same law
10 office represented PEPO - i.e., the party on the other side of the lawsuit! Both
11 attorneys were paid by the same person or entity. PEPO's attorney then caused about
12 $15 million worth of real estate to be transferred to the Plaintiff Corporation
13 noteholder in "satisfaction" of its "$195,000 claim." Included in that real estate were
14 the residences which Plaintiffs had purchased, as well as the residences of other
15 similarly-situated persons. As part of the scheme, no transfer of title was made to the
16 Plaintiffs. The net result is that Plaintiffs paid for the real estate, and now,
17 accordingly to the Defendant "rescuers," Plaintiffs have nothing, while Defendant
18 PEHC owns all of that real estate through various wholly owned subsidiaries.
19
GENERAL ALLEGATIONS
20
21
27. Pelican E es Resort was founded in 2003 and k located in San Juan del
2" Stir, Nicai'aua. It is a reovt consistinc of appl'oxinlatel\ 27 acres near the Pacific
l icam'aua. It includes t\\ (I rctauramiN, three imnmiiin pok. lammdcaped
C)!11Hi)I1 IIcH. amid ì\ em - (() mcidcmttial milt. I he Rckni \a iml!tiall\ de\ duped in
20) h\ (hri Bdmm\ a place to ll\ e. amid then e\pamidcd inN) a reurt a triemak amid
2 other iH \\antdd liumne iii the area.
Case 2:11-cv-10284-JFW-PJW Document 22 Filed 04/09/12 Page 8 of 36 Page ID #:559
1
Plaintiffs Purchase Their Residences
2
28. In 2005. the Nurock Plaintiffs decided to purchase a home in the Reoi't
3 from PEPO for 2(),0O0. The Nicaraguan law firm of Garcia & Bodan ("G&B)
4 rprcciiud PEPO, and provided Plaintiffs with a fully executed Purchac and Sale
5 Agreement for the acquisition of a townhouse in the Rort called Casa Fantasia.
6 Plaintiffs paid PEPO S -2 69,000 in a series of installments, and took possession of the
7 residence in October, 2007.
8
29. In 2006, the Moezzi Plaintiffs decided to purchase a home in the Resort
9 from PEPO for $379,000. G&B also represented PEPO in this transaction and
provided the Moezzi Plaintiffs with a fully executed Purchase and Sale Agreement
11 for the acquisition of a townhouse in the Resort called Casa Florida. Plaintiffs paid
12 PEPO $379,000 in a series of installments, and took possession of the residence in
13 November, 2007.
14
30. In about 2006, the Dahlheimer Plaintiffs decided to purchase a
15 townhome in the Resort from PEPO for $242,500. G&B also represented PEPO in
16 this transaction and provided the Dahlheimer Plaintiffs with a fully executed Purchase
17 and Sale Agreement for the acquisition of a townhouse in the Resort called Casa
18 Verde. Plaintiffs paid PEPO $242,500 in a series of installments, and took possession
19 of the residence in 2008.
20
Defendant Corporations Scheme to Defraud Plaintiffs
21
31. On or about Aiiut 12, 2009, PRG a formed nndcr the laws of the
22 State of California.
32. On or about Auut 2. 2)), :\DE[ forincd uIRIcr thc Iaw t
24 IQ till. !)cicidaiit 1Ltiikla iic t it Iiaicl Ith'i ..\DFI c!aiT1 a bc tilL'
O\\ I1CI' H IlldIl\ H titc i'cidcucc in the Rcort.
2
On r about \itri 2. 2(X)), US Hriuci uiiicr the !a\\\ H
II J'11111> H bc liH \\ ML'!' H at icat uc III titc Rcu'i. 11111 i
'3•
I
Case 2:11 -cv- 10284-JFW-PJW Document 22 Filed 04/09/12 Page 9 of 36 Page ID #:560
I the entity through which many of the Resort operations are conducted.
2
34. On or about September 2, 2009, Defendants made a claim that the
3 promissory Note (that nobody has ever seen) existed. The due date on the Note was
4 \iarch 1,2010. The Note reflected that PEPO purportedly owed ADH $195,000. No
5 such debt was in fact owed, and the Note was a fabrication that was part of a scheme
6 to defraud Plaintiffs of their respective interests in Casa Fantasia and in Casa Florida.
7
35. On or about September 17, 2009, Togo was formed under the laws of
8 Nicaragua. Togo claims to be the owner of at least one residence in the Resort.
9 ; 36. On or about October 15, 2009, Chris Berry, the President of PEPO, left
10 Nicaragua.
11
37. On or about October 24, 2009, Defendant Emling sent an email to
12 various Resort homeowners, including Plaintiff Nurock, in which he stated in
13 pertinent part that "[ojur priority is to get people their deeds and to get the promised
14 houses built."
15
38. On or about November 17, 2009 PEHC was formed under the laws of the
16 State of California,
17
39. Plaintiffs are informed and believe, and on that basis allege, that in or
18 about November 25, 2009, PRIG, ADH, which was represented by Gladis Maria
19 Zapata Parades, and Hankla met to plan how, among other things, they would oh tai i
20 ownership for PEHC of all of the real estate in the Resort. During the course of that
21 nicct iii. and as part o thcir plan to achic\ c ftc a1arcmciitioned result, thcv provided
22 ajudicial powcr of attorncv to attorney IKatia Grkcll Tijcrino Urnana ("L III all a").
2
40. On orthmit Dcccinhcr 1, 200). Dcicndants HanLia and Enilinc cnt an
2 4 cniail i iNc lliuc\\ ncr' in iNc Rcii. iiiclndin Plaiiiiif I \nitcL. in \\ Inch lIIc\
Ici\cd that. ainoiia thcr ihiiic:
() (a) \ on kin, nicnciaI plan ha lccii h anitizc iNc Hrnici act 1
27
Pcj H pi cc inc lhciii thi ncIi nccl ii ft I Iii \ nId a! N ti a
Case 2: 11-cv-10284-JFW-PJW Document 22 Filed 04/09/12 Page 10 of 36 Page ID #:561
1
move forward, get deeds to those with homes, build or refund
2
unconstructed homes out of the homeowner side of the income. .
3
(Emphasis added).
4
(b) "The present iWation is that Pelican Rc'ciic LLC now owns most of
5
phase one throuh a Nicaragua subsidiary, as a result of agreement with
6
the bank and that bank foreclosure process. This is a self contained
7
functional property as far as we are concerned. As to phase two, the
8
property isprc.sciith' under a lien. This has the advantage ofprevenring
9
other outside creditors from having a go at any particular indRiJiuil's
10
house. Liider current thinking, we would go ahead andforeclose on that
11
part ourselves, and then proceed to make new deals with those
12
homeowners, including getting the deeds issued." (Emphasis added).
13
41. On or about December 8, 2009, the Pelican Homeowners LLC ("PH")
14 was formed. That entity was an Ohio limited liability company and was to operate as
15 a voice for the homeowners in the Resort.
16
42. On or about December 13, 2009, Defendants Hankla, Emling and PRG,
17 among others, sent an email to Plaintiff Nurock and others. In that email, these
18 Defendants stated: "[t]he HOSC and PRG are also working jointly on special projects
19 concerning Phase 2 and other as yet unencumbered PEPO land." (Emphasis added).
20
43. On or about December 22, 2009, the first private placement
21 nicinranduin ("First PPM ") as ksucd by PEHC, control led by 1-lankla aiid Enil in LT
21 (timomi othcr . Among other t h iii. it stated the fol!o inc:
(a) That PFHC \\(kil14 \\itIl PEPO Lint otrinI\ H iiupleiiiciit
24 a ic1ritcU Iii ne plan:
H That the Rcor I Illchtdc(I i\t\-t!\c pri\aielv iu'/ rcHdc!ltia!
() I iit. and that P11k). S.,\. eciItial!\ )\\ ned c\cr\lhine e\cepi the LuiN:
27
C Ihat the keit lionki tai'1 H 'i]eOttC jOit]\ e C a1i !ho\\
10
Case 2: 11-cv-10284-JFW-PJW Document 22 Filed 04/09/12 Page 11 of 36 Page ID #:562
I II beginning in December 2009;
2
(d) That PEHC antic ipaicd acquiring all of PEPO's assets through a
3 structured transaction by January 2010;
4
(e) That the PRGLPEHC restructuring plan included various e Ic mci t ,
5 of which one was to "correct certain legal deficiencies affecting current Unit owners
6 Mid huvcr;'
7
(t) That Unit owners will be would be required to participate in a ten
8 year rental plan and in exchange for their participation, Unit owners would receive
9 a deed to their individual Units. (Emphasis added to all); and
10
(g) That the Resort net operating income (before allocations to PEHC
11 and Unit owners) was projected to be $835,000 in 2010 and would stabilize at $3.5
12 million in 2014. The PPM also included a table containing "Financial Projections,"
13 a table entitled "Sources and Uses" (of funds), and a table entitled "Investment
14
15
44. In addition to the First PPM, the offering was also comprised of a
16 "Subscription Booklet and Instructions" ("Subscription Agreement"), and the
17 "Operating Agreement of Pelican Eyes Holding Company, LLC ("Operating
18 Agreement)." The Subscription Agreement, provided, among other things, that a
19 Subscriber agreed to purchase units in PEHC "in accordance with" the First PPM and
20 the Operating Agreement.
21
45, On or about December 31, 2009, Richard B. Garrett ("Garrctt"). the
Sccictarv of PFHCandaNEmazcr of it. cnt an email to Plaintiff Nurnck and otheis
ill \\ hicil ic ad\ kcd, in pertincnt part, that; "ii n\ctJncnt iii Pclicaii [\c IIOLIiIi$
24
(oIupwi\. IL( uicaii that \HU \\ ill IIa\c harc in [HL ('OIP\\) that o
Case 2: 11-cv-10284-JFW-PJW Document 22 Filed 04/09/12 Page 33 of 36 Page ID #:584
1 things, undertaking the scheme described above to deprive Plaintiffs and the Class
2 of their home ownership, as opposed to securing and protecting title for them in their
3 respective properties.
4
153. Plainiiffs performed all covcnants and conditions of the agreements
5 which they were required to perform.
6 154. As a result of Defendants' breach, Plaintiffs siiftcred damages in the
7 amount of their Investments and the loss of their properties.
8
9
PRAYER FOR RELIEF
10
WHEREFORE, Plaintiffs, on behalf of all others similarly-situated, pray for
11 judgment and relief on all causes of action as follows:
12 1. An Order Certifying the Plaintiff Class;
13 2. Compensatory and consequential damages, in an amount to be proven
14 at trial;
15 3, Rescission and/or recessionary damages, where allowed by law;
16 4. Attorneys' fees as permitted by law;
17 5. Costs of this suit;
18 6. Pre-judgment and post-judgment interest; and
19 7, Such other and further relief as the Court may deem necessary or
20 appropriate.
21 22 DATED: April 9, 2012
WILS I-FIRE PALISADES LAW GROUP, P.C.
23 I
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Case 2: 11-cv-10284-JFW-PJW Document 22 Filed 04/09/12 Page 34 of 36 Page ID #:585
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DEMAND FOR JURY TRIAL
2 Plaintiffs hereby demand a trial by jury.
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4 DATED: April 9, 2012 WILSHIRE PALISADES LAW GROUP, P.C.
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By: DaN id I. Lefkowitz
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Attorneys for All Plaintiffs
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INF
Case 2:11-cv-10284-JFW-PJW Document 22 Filed 04/09/12 Page 35 of 36 Page ID #:586
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I STATE OF CALIFORNIA 1 ss.
COUNTY OF LOS ANGELES
I am employed in the County of Los Angeles, State of California by Wilshire Palisades Law Group, P.C. ("WPLG"). WPLG's business address is 1337 Ocean Avenue. Suite A. Santa Monica, California 90401-1009. I am over 18 years of age and I am not a party to this action,
On April 9, 2012 I transmitted from Santa Monica, California, the documents identified below:
PLAINTIFFS' FIRST AMENDED COMPLAINT
The foregoing document was addressed to the persons listed on the "Service List" which is attached hereto and incorporated herein by reference. Those addresses are the last office addresses given by those persons in the most recent document filed in this action and served upon WPLG.
X (BY U.S. MAIL) I placed a true copy in a sealed envelope addressed as indicated above on the above-mentioned date. I am familiar with the firm's practice of collection and processing correspondence for delivery by an overnight delivery carrier. Pursuant to that practice, envelopes placed for collection at designated locations during designated hours are delivered with a fully completed airway bill, under which all delivery charges are paid by Wilshire Palisades Law Group that same day in the ordinary course of business.
X (BY E-MAIL) I personally c-mailed to each party indicated above a copy of the aforesaid document.
I declare under penalty of perjury under the laws of the State of California that the above is true and correct.
Executed on April 9, 2012 at Santa Monicw California.
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Case 2:11-cv-10284-JFW-PJW Document 22 Filed 04/09/12 Page 36 of 36 Page ID #:587
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SERVICE LIST
Douglas B. Nurock, et at. v. Pelican Eyes Holding Company, He, et al. U.S. District Court - Central District of California Casc No, CV 1 l-10284-JFW (PJWx)
Attornes for Defendants Pelican Eyes Holding Company LLC, Pelican Rescue LLC, James K. Hankla, Michael J. Emting:
Joseph E. Porter III Law Offices of Joseph E. Porter III 206 3rd Street Seal Beach, CA 90740 [email protected]
Michael J. Emling Emling Forensis PC 333 S. Anita Dr. Suite 300 Orange, CA 92868 [email protected]